Shares of big, reputable, long-standing businesses with a solid financial foundation make up large stable companies. It is widely acknowledged by investors that these large corporations yield consistent profits. The majority of these large-sized businesses regularly pays dividends and is often established, well-capitalized businesses.
Strong balance sheets, consistent cash flows, tested business plans, and a track record of growing dividends are characteristics of these companies. Here are the biggest ASX-listed companies across various industries; they may be essentially sound companies with steady dividend growth, or they may be at more advanced stages of development. Let's investigate them:
Note: As of 6 February 2024, the market capitalization and share price of the chosen ASX stocks are listed below.
BHP Group Limited (ASX: BHP)
Market cap: $235.92 billion
CMP: $46.545
With the construction of the Jansen mine in Canada and the approval of Jansen Stage 2, BHP has made headway towards its growth plan, which may double the company's projected potash production capacity. Via a 2-kilometer strike length, attractive copper mineralization above 1% grade has been found through extensive exploration drilling beneath Olympic Dam, with areas above 2%. BHP's integration of its Copper SA business in South Africa was successful. The business is heavily investing in growth, as evidenced by its approval of US$4.9 billion for Jansen Stage 2. The company's ongoing strategy focus on higher-quality metallurgical coal includes the intention to sell BMA's Blackwater and Daunia mines for up to US$4.1 billion (100% basis) in cash.
Commonwealth Bank of Australia (ASX: CBA)
Market cap: $192.70 billion
CMP: $115.07
The balance sheet is still robust fundamentally, with a CET ratio of 11.8%, which is significantly higher than the legal minimum. In keeping with the company's efforts to fortify the balance sheet, a $700 million portion of the $1 billion share buyback plan has already been carried out. With robust credit facilities, slightly lower home loan arrears, and a balanced position overall, the company downplayed the rising interest rate regime.
CSL Limited (ASX: CSL)
Market cap: $144.83 billion
CMP: $299.79
To accelerate the medium-term recovery in the company's Behring's margin, the company is specifically taking action with a number of front-end initiatives. From a medium-term standpoint, CSL anticipates improved growth aspects. Immunoglobulin (Ig) is predicted to continue growing strongly in the wake of FY2023's record plasma collections. A consistent improvement in ROIC is supported by CSL Limited's strategies to produce double-digit annual earnings growth.
National Australia Bank Limited (ASX: NAB)
Market cap: $100.29 billion
CMP: $32.21
The bank maintains a strong capital position, surpassing its targets, and possesses solid liquidity. Additionally, NAB's collective provision coverage remains significantly above pre-COVID-19 levels, highlighting prudent risk management.
The bank remains steadfast in executing its strategic plan, emphasizing sustained growth in earnings and enhanced shareholder returns. Strategically poised for the future, NAB emphasizes a balanced approach that combines rigorous cost discipline with strategic investments for sustainable growth. In the upcoming fiscal year, FY24, NAB aims for an investment spend of approximately $1.4 billion. Additionally, the bank targets further productivity savings, aiming for approximately $400 million.
Fortescue Limited (ASX: FMG)
Market cap: $89.23 billion
CMP: $28.98
Fortescue Limited's outlook is marked by a strategic and diversified approach across its key operational areas. Successful commissioning activities and multiple shipments of Iron Bridge Concentrate underscore the positive trajectory in the iron ore sector, with a projected range of 192 to 197 million tonnes for FY24. Fortescue's leadership in green energy initiatives, exemplified by major investments and the launch of Fortescue Capital, positions the company at the forefront of sustainability in the industry. Financial resilience is evident with a strong cash balance of US$4.7 billion, and strategic moves into technology and manufacturing, as seen with the US Advanced Manufacturing Centre, showcase value-added production capabilities.
Reference: *All Data has been sourced from Company announcements and Refinitiv, Thomson Reuters
Frequently Asked Questions (F.A.Q)
What are the largest ASX companies based on market capitalization?
• BHP Group Limited (ASX: BHP)
• Commonwealth Bank of Australia (ASX: CBA)
• CSL Limited (ASX: CSL)
• National Australia Bank Limited (ASX: NAB)
• Fortescue Limited (ASX: FMG)
What are the fundamentals of Fortescue Limited?
Fortescue's leadership in green energy initiatives, exemplified by major investments and the launch of Fortescue Capital, positions the company at the forefront of sustainability in the industry. Successful commissioning activities and multiple shipments of Iron Bridge Concentrate underscore the positive trajectory in the iron ore sector, with a projected range of 192 to 197 million tonnes for FY2024. Financial resilience is evident with a strong cash balance of US$4.7 billion, and strategic moves into technology and manufacturing, as seen with the US Advanced Manufacturing Centre, showcase value-added production capabilities.
What are the characteristics of ASX’s heavy-weighted companies?
Strong balance sheets, consistent cash flows, tested business plans, and a track record of growing dividends are characteristics of such companies.
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